Half of employers do not have a financial wellbeing strategy


Almost half (49%) of employers do not have a financial wellbeing strategy in place for their employees, according to research by pensions and investment consultancy Barnett Waddingham.

Beyond Pensions: Pension and the Provision of Wider Financial Wellbeing, an Employer’s Perspective, which surveyed 200 UK organisations and 43 of the firm’s client base, also found that although 84% of respondents feel there is a need for financial education and guidance for their employees, 60% do not provide any form of guidance. Similarly, almost two-thirds (60%) of respondents have not raised any awareness among employees to safeguard them against pension scams.

Paul Leandro (pictured), partner at Barnett Waddingham, said: “Until financial wellbeing enters the board level agenda, and overarching strategies are agreed and monitored, employees will continue to receive employer-paid benefits that are not effective at helping them with the financial issues they face today or tomorrow, or the ‘one day’.”

The majority (88%) of respondents are concerned about the financial issues their employees are struggling with, and 50% believe their employees look to them for financial advice and guidance. Despite this, 61% of respondents cite cost as one of the main obstacles to implementing financial wellbeing provisions. Other obstacles include measuring return on investment (33%), employee engagement (41%) and board level buy-in (19%).

“Obtaining board level buy-in is a priority for HR and pensions managers,” added Leandro. “But proving the value of having a well thought-out financial wellbeing strategy, which provides a tangible return on investment, is key to this. Only 50% of organisations actually have measures in place to address this.”

Three-quarters (74%) of respondents contribute more than the minimum auto-enrolment rates to their employees’ pension scheme. A quarter (24%) of respondents think the employer has the main responsibility for ensuring employees have the minimum living wage income at retirement, compared to 28% who feel this responsibility lies on the employee and 27% who believe the government should take ownership of this.

Around 62% of respondents do not think their organisation has a gender pay gap, while 68% of employers feel the gap between non-management and senior management pay is right, compared to 27% of employees.

Under a third (29%) of respondents have introduced financial planning and advice as a wider financial provision to help staff. This compares to 28% who have implemented employer loans and debt management, 26% who have introduced share schemes, 25% who have put financial education in place and 10% who have implemented workplace individual savings accounts (Isas).

Sign up to our newsletters

Receive news and guidance on a range of HR issues direct to your inbox

This field is for validation purposes and should be left unchanged.

More than half (58%) of respondents cite the key benefit of their organisation’s defined contribution (DC) pension scheme, from the employer’s point of view, is to reward employees, while 39% believe it helps to retain employees and 42% think it helps employees retire when they are ready. Interestingly, 37% of employers would have the appetite for a collective DC scheme, if these were to come into force.

Leandro said: “Regulatory fatigue around pensions is lessening and given there has been no policy changes for three years, employers feel they have more freedom to be creative with the wider pension and financial benefit strategy for employees. However, beyond pension provision, [organisations] are struggling to implement the right level of financial wellbeing support and provisions.”